70 users should NOT be running off that kind of hardware really...especially not EVERYTHING on one server,so many things could go so badly wrong.
Ask them this: when it does fail,will the "savings" from not spending on more hardware help? Much like life insurance adequate hardware and licenses are there to make the worst-case scenario less devastating.
Ideally what you'd need to do is drop down a few thousand ( 30ish excl licenses ). Get a Quad Core with 16gig or so of RAM and a lovely RAID NAS and some sata drives for the big server. Virtualize the different required business units' into its own servers ( SBS2008 premium for instance allows licensing for a 2nd Server 2008 to be used for Databases )
SBS can handle the VPN/Terminal services,DB server explicitly for Databases and NAS for network drive storage
Barring that chat to the guys from
http://www.universe-direct.co.za/ and
http://www.xperien.com/ a call,find out what smaller Refurbished servers they have available. Then seperate out the Mail/Terminal services or Pastel/Caseware to this new box
*Edit - NAS has benefit of not needing CALs to access and the smarter ones can integrate to use your AD authentication